Kiwi Shows Weakness In Early Trade

Renewed selling pressure hits NZD/USD at the start to the week, seeing the pair extend its slide from Friday's NY hours, which prompted it to trim gains into the close. The rate last deals at $0.6240, down 26 pips on the day.

• The risk backdrop remains questionable, with e-minis & most Asian equity index futures trading in the red. Early upticks in crude oil prices have failed to filter through into the commodity-tied FX space as of yet.
• Geopolitical matters likely discourage participants from taking on more risk, with Sino-U.S. tensions bubbling amid House Speaker Pelosi's planned visit to Taiwan.
• Participants have further dialled down hawkish RBNZ bets this morning. The OIS strip prices 55bp worth of OCR hikes at the August MPS, per Bloomberg WIRP tool, versus ~58bp priced on Friday.
• From a technical perspective, a retreat under Jul 14 low of $0.6061 would suggest that bears are having the upper hand again. Bulls need a break above the 50-DMA/Jun 24 & 27 highs at $0.6315/27 before setting their sights on Jun 16 high of $0.6396.
• A couple of ANZ sentiment surveys headline the local docket this week. The ANZBO will cross the wires on Thursday, with Consumer Confidence Index coming up Friday.